Is our checks and balances system of government the root cause of the impending debt ceiling crisis? Based on theories in his book and teachings, Reputation Rules author Daniel Diermeier points out the risk of holding out for the optimal scenario in a bargaining situation like the one with which the President and Congress are currently dealing.
“Game-theoretic models of bargaining point out that the pervasive uncertainty in negotiation agreements may be difficult to reach, as both sides believe they can reach a better deal. But the costs associated with strikes and delays also reduce incomplete information over time, making an agreement possible. That said, in many settings negotiations can break down permanently even after long negotiations.”
He points out that the current crisis lead back to the way our government is set up:
“Increased partisanship makes this problem more severe, but not its root cause; it is a feature of our system of governance.”
Most importantly, Diermeier offers suggestions on how to get us out of the current debacle in Washington. For the full story and more strategies on building reputation into your organizational structure: Full article